India's Core Industries
Cheap Steel Imports and Safeguard Duties
Why surges of cheap steel from China worry Indian producers, how safeguard duties work, and the trade-off between protecting steelmakers and helping steel users.
China produces more than half of the world’s steel. When Chinese demand weakens, excess steel is exported at low prices, affecting producers worldwide.
India’s concern
In 2024 and 2025, imports of steel into India rose, especially from China, South Korea and Japan, and via some ASEAN countries. Indian steelmakers complained of falling prices and margins.
Safeguard duties
A safeguard duty is a temporary tariff on imports when a sudden surge seriously harms a domestic industry, allowed under WTO rules even without proving dumping.
In 2025, India imposed a provisional safeguard duty of 12 percent on certain flat steel imports, later moving toward a longer-term duty.
The trade-off
Steelmakers gain from higher prices and protection.
Steel users lose:
- Auto and appliance makers face higher costs.
- Construction and infrastructure costs rise.
- Small engineering firms that export may become less competitive.
Anti-dumping
India also uses anti-dumping duties on specific steel products when foreign firms sell below fair value.
The bigger picture
Global steel overcapacity, concentrated in China, leads many countries, including the US and EU, to protect their industries. This creates a web of trade barriers.
When safeguard duties raise domestic steel prices, a refrigerator maker's costs rise. It passes some of the increase to consumers and absorbs the rest, reducing profits. Steelmakers, meanwhile, report better margins.
Protecting steelmakers raises costs for industries that use steel, from carmakers to builders.
- Chinese overcapacity sends cheap steel into world markets.
- India imposed a provisional 12 percent safeguard duty on some flat steel in 2025.
- Steelmakers gain, while steel users face higher costs.
- Many countries protect steel, creating global trade barriers.
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